Key points from the Autumn Statement 2013
Here are the major areas of George Osborne’s Autumn Statement on the state of the economy and the government's plans.
Dave Lancaster |
11:41 06 December 2013
The Autumn Statement has outlined some big changes for the months ahead such as paper tax discs being replaced by an electronic system for motorists, an abolition of the cap on student numbers, the economy’s revised growth figures, spending cuts and new pension ages. Find out about what really matters with our at-a-glance summary below:
- 2013’s growth forecast increased from 0.6% to 1.4%. Revised up for next year from 1.8% to 2.4%. Following three years also up but at a slower rate: 2.2%, 2.6%, and 2.7%.
- UK GDP declined at a greater rate than initially thought: by 7.2% in 2008-09, not previously published 6.3% (equivalent of £112bn).
- Borrowing figure of £111bn this year. 2014-2015 set to fall to 2014-15 to £96bn, then down to £79bn in 2015-16, £51bn the year after before a much larger dip to £23bn the year afterwards.
- The UK's "underlying" deficit revised down by the Office for Budget Responsibility (OBR) to 6.8% this year, and to 5.6% the following year. Estimated further falls to 4.4%, 2.7% and 1.2% in the subsequent financial years.
- Public debt this year is due to total 75.5% of GDP. The figure is lower than initially forecasted; it will rise to 78.3% in 2014 and peak at 80% the next year.
- No increase to the current aid budget. Targets of spending 0.7% of gross national income on international development to be met.
TAXES & ALLOWANCES
- January 2014 onwards: bank levy rate will rise to 0.156%. This looks set to raise £2.7bn in 2014-15 and slightly more each year going forward.
- From April 2014, personal income tax allowance will rise to £10,000. This figure will increase in line with inflation for coming years.
- April 2014 also sees a new tax relief for investment in new ‘social impact’ bonds and social enterprises.
- From April 2015, capital gains tax will be forced on future gains made by non-residents who sell residential property in Britain.
- Employer National Insurance contributions for young people are to be scrapped affecting 1.5 million jobs.
- A married couples and civil partners tax break proposed to launch in April 2015, whereby citizens can transfer £1,000 of their income tax allowance to their partners.
- Business rates in England to be capped at 2%, moving away from being linked to RPI inflation.
- Businesses that move into empty high-street properties will see their rates cut by 50%.
PENSIONS & BENEFITS
- The state pension age to increase: up to 68 in the mid-2030s and to 69 in the late 2040s.
- State pension pay outs to increase as well: In April 2014, it will rise by £2.95/week.
- Welfare spending is to be capped across the board.
- 18-21 year-olds claiming benefits without basic English or Maths will be given training from day one. If unaccepted, they will lose their entitlement.
- Those unemployed for over half a year will have to start a traineeship, take on work experience or perform community placements if they want to keep their benefits.
- Unemployment figures are already down. These are now forecast to fall from 7.6% this year to 7% in 2015 and by a further 5.6% in 2018.
- Available jobs to rise by 400,000 this year.
- An estimated 3.1 million jobs to be created by 2019.
- The government's start-up loans scheme to be enhanced to invest in 50,000 more people starting their own businesses.
- Export finance capacity available to support British businesses will be doubled to £50bn.
- Petrol taxes remain frozen.
- An initially planned rise of 2p per litre for 2014 cancelled.
- Train fares were originally going to be upped at 1% above RPI. This has been scrapped to regulate them in line with inflation instead.
- Paper tax disc for motorists will be replaced with an alternate electronic system.
- 30,000 new places at English universities to be created in 2014-15.
- From 2015, the existing cap on student numbers will be ended.
- 20,000 more apprenticeships are to be funded over the next two years.
- All pupils at state schools in England in Reception, Year 1 and Year 2 will receive free school lunches from next September.
- £1bn in loans will boost housing developments in key locations.
- The housing revenue account will see its limit on borrowing increase by £300m.
- Councils will free funding and resources by selling the most expensive social housing and deprived urban housing estates allowing them to be regenerated. Those who need to move home to find a job are given priority in council house allocations.